Daily Outlook - Markets rally after Easter, FOMC Ahead

By @ibtimes on

U.S. Dollar Trading (USD) global markets soared over night with investors coming back from Easter with a positive mood. US House Prices fell less than expected at -0.2% and April CB consumer confidence rose 1.6 points to 65.4 previously. In US stocks, DJIA +115 points closing at 12595, S&P +11 points closing at 1347 and NASDAQ +21 points closing at 2847. Looking ahead, US FOMC Decision at 0.25% with Bernanke giving rare press conference afterwards.

The Euro (EUR) heavy buying in Europe and US session ended speculation that the USD rout would ease into the FOMC decision. 1.4700 was taken out in late US trade with the market also support on heavy EUR/GBP buying towards the 0.8900 level. Overall the EUR/USD traded with a low of 1.4492 and a high of 1.4715 before closing the day around 1.4690 in the New York session. Looking ahead, February Industrial Orders forecast at 1.0% vs. 0.1% previously.

The Japanese Yen (JPY) USD/JPY traded at new lows after failing once again to get above Y82 resistance. USD weakness is encouraging new lows in the market but many players are waiting for today's FOMC decision to pick fresh direction. Overall the USD/JPY traded with a low of 81.25 and a high of 82.00 before closing the day around 81.40 in the New York session. UPDATE MARCH Retail Sales -8.5% vs. 0.1% previously y/y.

The Sterling (GBP) failed to push higher with the rest of the market sticking to the 1.6500 level. UK CBI Trends was weak in April falling to -11 vs. 5 forecast. Overall the GBP/USD traded with a low of 1.6429 and a high of 1.6535 before closing the day at 1.6510 in the New York session. Looking ahead, Q1 GDP forecast at 0.5% vs. -0.5% previously.

The Australian Dollar (AUD) the Aussie broke above 1.0800 briefly as the market responded to buying in stock markets. The market is hitting fresh highs each day with little technical resistance and profit taking the only factor slowing the ascent. Overall the AUD/USD traded with a low of 1.0675 and a high of 1.0825 before  closing the day at 1.0795 in the New York session. UPDATE Q1 CPI at 1.6% vs. 0.4%.

Oil & Gold (XAU) Gold tested support below $1500 twice last night before finishing above the figure. Overall trading with a low of USD$1492 and high of USD $1510 before ending the New York session at USD$1507 an ounce. Crude Oil did well with middle east tensions and weak USD allowing the uptrend to resume. WTI Oil Closed +$1.00 at $112.20 a barrel.

TECHNICAL COMMENTARY

Currency

Sup 2

Sup 1

Spot

Res 1

Res 2

EUR/USD

1.4328

1.4500

1.4675

1.4685

1.4736

USD/JPY

80.89

81.31

81.70

82.60

83.27

GBP/USD

1.6308

1.6387

1.6480

1.6599

1.6672

AUD/USD

1.0519

1.0677

1.0830

1.0845

1.0932

XAU/USD

1477.00

1487

1507

1518

1550

OIL/USD

108.00

110.00

112.00

113.50

115.00

Euro - 1.4675

Initial support at 1.4500 (Psychological Support) followed by 1.4328 (Apr 20 low). Initial resistance is now located at 1.4685 (Dec 14 2009 high) followed by 1.4736 (1.3752 plus 1.618 of 1.3428-1.4036)

Yen - 81.70

Initial support is located at 81.31 (Mar 28 low) followed by 80.89 (50% retrace of 76.25-85.53). Initial resistance is now at 82.60 (Apr 21 low) followed by 83.27 (Apr 18 High).

Pound - 1.6480

Initial support at 1.6387 (April 21 low) followed by 1.6308 (Apr 20 low). Initial resistance is now at 1.6599 (Apr 21 high) followed by 1.6672 (Dec 4 2009 high).

Australian Dollar - 1.0830

Initial support at 1.0677 (Apr 21 low) followed by the 1.0519 (Apr 20 low). Initial resistance is now at 1.0845 (0.9537 plus 0.618 of 0.8067-1.0183) followed by 1.0932 (1.0390 plus 0.618 of 0.9706-1.0584).

Gold - 1507

Initial support at 1487 (Apr 19 low) followed by 1477 (Apr 18 low). Initial resistance is now at 1518 (Apr 28 low) followed by 1550 (Big level).

Oil - 112.30

Initial support at 110.00 (Intraday Support) followed by 108.00 (Intraday Support). Initial resistance is now at 113.50 (Intraday resistance) followed by 115.00 (Intraday Resistance).

Written by Anthony Darvall

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